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This sparked a backlash from pro-EU MPs, who said the PM had “capitulated”.

Her majority was slashed to just three as pro-European Tories protested about the Prime Minister’s concessions by voting against her.

The first of those amendments, which would prevent the UK collecting duties for the EU unless Brussels agreed reciprocal arrangements passed with 305 votes in favour, and 302 against.

(Image: AFP)

The Government took on Rees-Mogg's amendments (Image: AFP)

There were 14 Tory rebels who voted against the Government-backed Tory Eurosceptic clause including defence procurement minister Guto Bebb - who dramatically resigned at the door of the lobby.

The Eurosceptic Conservative MPs’ amendment to stop the UK from joining the EU’s VAT regime, was also approved by a majority of three - 303 votes to 300.

There were 11 Conservative rebels who voted against. but Mr Bebb was not one of them.

But the Customs Bill itself passed by 318 votes to 285 - majority 33.

Guto Bebb resigned to vote against the Government (Image: Daily Post Wales)

It comes after Theresa May produced a plan at her Chequers country residence which would keep the UK closely tied to Brussels’ rules on goods and food which angered many of those who supported Leave.

A number 10 source said ahead of the votes last night. “We have accepted the amendments because we believe its consistent with the approach that we set out.”

Labour’s shadow chancellor John McDonnell said: “Theresa May has now lost all moral authority in order to scrape through tonight by three votes she sold out ot hard Tory right and tore up the White Paper she published only days ago.

“Craven cowardice not worth of a Prime Minister. We can’t go on like this.”

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But Remain-supporting Labour MP Chuka Umunna praised Mr Bebb for quitting his government role, saying: “It’s good to see a minister putting his country before his party and his career. More should follow his example.

“This is a question of who governs Britain: the Tory backbench Brexiteers or the people? More and more Tory MPs are saying it should be the people not some hard Right minority”.

Liberal Democrat Brexit Spokesperson Tom Brake said: “Today we have seen the truly calamitous state of the Tory party, as once again the Prime Minister is forced to concede ground to hold together her unholy alliance of MPs.

“The precarious nature and weakness of this Government means they have to try to ram through the Brexit process, whilst attempting to grant draconian powers to Ministers to change laws without due process or scrutiny.

“This is not taking back control. It is a sinister power-grab by a Prime Minister on the brink of falling head first into the Brexit black-hole whilst her former allies circle around her, vying for position.

“The Customs Union is essential to the basic stability and prosperity of the UK. Nobody voted for job losses and financial uncertainty. That is why we must now give the people the final say and an opportunity to Exit from Brexit.”